Justia U.S. Federal Circuit Court of Appeals Opinion SummariesArticles Posted in Trademark
Authentic Apparel Geoup, LLC v. United States
In 2010, the Army granted Authentic a nonexclusive license to manufacture and sell clothing bearing the Army’s trademarks. The agreement required the Army’s advance written approval of any products and marketing materials bearing the Army’s trademarks and included exculpatory clauses that exempted the Army from liability for exercising its discretion to deny approval. In 2011-2014, Authentic submitted nearly 500 requests for approval; the Army disapproved 41 submissions. During that time, Authentic received several formal notices of material breach for claimed failures to timely submit royalty reports and pay royalties. Authentic eventually paid its royalties through 2013. Authentic’s counsel indicated that Authentic would not pay outstanding royalties for 2014.Authentic's ensuing breach of contract suit cited the Army’s denial of the right to exploit the goodwill associated with the Army’s trademarks, refusal to permit Authentic to advertise its contribution to Army recreation programs, delay of approval for a financing agreement, denial of approval for advertising, and breach of the implied duty of good faith and fair dealing by not approving the sale of certain garments. The Federal Circuit affirmed summary judgment in favor of the government. The license agreement stated in no uncertain terms that the Army had “sole and absolute discretion” regarding approval of Authentic’s proposed products and marketing materials; the exercise of that broad approval discretion is not inconsistent with principles of trademark law. View "Authentic Apparel Geoup, LLC v. United States" on Justia Law
QuikTrip West, Inc. v. Weigel Stores, Inc.
QuikTrip and Weigel operate gasoline-convenience stores. QuikTrip has sold food and beverages in its stores under the registered mark QT KITCHENS since 2011. In 2014, Weigel began using the stylized mark W KITCHENS. QuikTrip requested that Weigel stop using the mark on the basis that it was confusingly similar to QuikTrip’s QT KITCHENS mark. Weigel modified its mark by changing the plural “KITCHENS” to the singular “KITCHEN,” altering the font, and adding the words “WEIGEL’S” and “NOW OPEN.” QuikTrip objected to Weigel’s continued use of the word “KITCHEN” in its mark. In 2017, Weigel applied to register the mark, W WEIGEL’S KITCHEN NOW OPEN.QuikTrip filed an opposition, 15 U.S.C. 1052(d). The Patent and Trademark Office Board evaluated the likelihood of confusion between the marks, referencing the “DuPont” factors, and found that the parties’ identical-in-part goods and related services, overlapping trade channels, overlapping classes of customers, and similar conditions of purchase pointed to a likelihood of confusion but that the dissimilarity of the marks weighed against a likelihood of confusion. It determined that customers would not focus on the word “KITCHEN” for source indication and that Weigel did not act in bad faith in adopting the mark. The Federal Circuit affirmed the dismissal of QuikTrip’s opposition. The finding that the marks, in their entireties, differ in appearance, sound, connotation, and commercial impression is supported by substantial evidence. View "QuikTrip West, Inc. v. Weigel Stores, Inc." on Justia Law
Corcamore, LLC v. SFM, LLC
SFM owns the federal registration for SPROUTS for use in connection with grocery store services. The SPROUTS mark was first used in commerce not later than April 2002. Corcamore owns a federal trademark registration for SPROUT for use in connection with vending machine services, claiming a first use date of May 2008. Corcamore’s SPROUT mark is used on a cashless payment card, an associated customer loyalty program, and a website for customers.SFM filed a petition with the Trademark Trial and Appeal Board to cancel Corcamore’s registration. Corcamore argued that SFM lacked standing. The Board determined that the Supreme Court’s Lexmark decision was not applicable; Lexmark was limited to civil actions for false advertising (15 U.S.C. 1125(a)) and does not extend to cancellation of registered marks (section 1064). The court concluded that SFM had standing because it sufficiently alleged a real interest in the proceeding and a reasonable belief of damage. Corcamore informed SFM’s counsel that it would bring “procedural maneuvers,” then proceeded to file motions in violation of Board orders, to refuse to cooperate with discovery, and to disregard Board-imposed sanctions.The Board granted SFM default judgment, citing 37 C.F.R. 2.120(h) and its inherent authority to control its docket. The Board concluded that a lesser sanction would be inappropriate because Corcamore had already violated sanctions and had engaged in willful, bad-faith tactics, consistent with its “procedural maneuvers” letter, taxing Board resources. The Federal Circuit affirmed. SFM was entitled to maintain a petition for cancellation of trademark registrations. The Board did not abuse its discretion in imposing default judgment. View "Corcamore, LLC v. SFM, LLC" on Justia Law
Australian Therapeutic Supplies Pty., Ltd. v. Naked TM, LLC
In 2000, Australian started advertising and selling condoms with the marks NAKED and NAKED CONDOM in Australia. In 2003, Australian, through its website, began advertising, selling, and shipping condoms featuring its unregistered mark to customers in the U.S. Naked owns Registration No. 3,325,577 for the mark NAKED for condoms. The companies engaged in settlement negotiations. Naked asserts that email communications demonstrate that the parties reached an agreement whereby Australian would discontinue its use of its unregistered mark in the U.S. and consent to Naked’s use and registration of its NAKED mark. Australian filed a petition to cancel the registration of the NAKED.The Trademark Trial and Appeal Board determined that Australian lacked standing and could not show an interest in the cancellation proceeding or a reasonable belief of damage because it had contracted away its proprietary rights in its unregistered marks.The Federal Circuit reversed. An absence of proprietary rights does not in itself negate an interest in the proceeding or a reasonable belief of damage. A petitioner seeking to cancel a trademark registration establishes an entitlement to bring a cancellation proceeding under 15 U.S.C. 1064 by demonstrating a real interest in the cancellation proceeding and a reasonable belief of damage regardless of whether the petitioner lacks a proprietary interest in an asserted unregistered mark. View "Australian Therapeutic Supplies Pty., Ltd. v. Naked TM, LLC" on Justia Law
Munchkin, Inc. v. Luv n’ Care, Ltd.
Munchkin sued LNC for trademark infringement and unfair competition claims based on LNC’s spill-proof drinking containers. A year later, the court allowed Munchkin to amend the complaint to include new trademark infringement claims, trade dress infringement claims, and patent infringement claims based on the 993 patent which is directed to a spill-proof drinking container. While the litigation was ongoing, Munchkin voluntarily dismissed all of its non-patent claims with prejudice. Munchkin’s 993 patent was held unpatentable through an inter partes review initiated by LNC. The Federal Circuit affirmed that Patent Trial and Appeal Board decision; Munchkin then dismissed its patent infringement claims. The district court subsequently granted LNC’s motion for attorney’s fees under 35 U.S.C. 285 and 15 U.S.C. 1117(a), finding the case to be “exceptional” because the trademark and trade dress infringement claims were substantively weak, and Munchkin should have been aware of the substantive weakness of its patent’s validity.The Federal Circuit reversed. LNC’s fee motion insufficiently presented the required facts and analysis needed to establish that Munchkin’s patent, trademark, and trade dress infringement claims were so substantively meritless to render the case exceptional. None of those issues were fully adjudicated before the court on the merits; the district court abused its discretion in granting the motion. View "Munchkin, Inc. v. Luv n' Care, Ltd." on Justia Law
Lanard Toys Ltd. v. Dolgencorp LLC
Lanard owns Design Patent D167 and the 458 copyright for a work entitled “Pencil/Chalk Holder,” relating to a toy chalk holder designed to look like a pencil. Lanard sold the Chalk Pencil, marked to indicate Lanard’s copyright and patent protections, to national retailers. Ja-Ru designed a toy chalk holder, using the Chalk Pencil as a reference sample. Lanard’s retailers stopped ordering the Chalk Pencil and began ordering Ja-Ru’s product. Lanard sued, asserting copyright infringement, design patent infringement, trade dress infringement, and statutory and common law unfair competition.The Federal Circuit affirmed summary judgment that Ja-Ru’s product does not infringe the patent, that the copyright is invalid and alternatively not infringed, and that Ja-Ru’s product does not infringe Lanard’s trade dress. Lanard’s unfair competition claims failed because its other claims failed. The district court properly construed the claims commensurate with the statutory protection for an ornamental design. Lanard impermissibly seeks to exclude any chalk holder in the shape of a pencil and extend the scope of the patent beyond the “new, original and ornamental design,” 35 U.S.C. 171. Lanard’s copyright is for the chalk holder itself; Lanard’s arguments seek protection for the dimensions and shape of the useful article itself. Because the chalk holder itself is not copyright protectable, Lanard cannot demonstrate that it holds a valid copyright. Lanard cannot establish that the Chalk Pencil has acquired secondary meaning. View "Lanard Toys Ltd. v. Dolgencorp LLC" on Justia Law
Stratus Networks, Inc. v. UBTA-UBET Communications Inc.
In 2012, Stratus, a facilities-based telecommunications provider, applied to register the STRATUS mark. UBTA, also a telecommunications provider, owns the STRATA mark and opposed registration of the STRATUS mark on grounds of a likelihood of confusion with UBTA’s STRATA mark. The Trademark Trial and Appeal Board found a likelihood of confusion and refused registration of the STRATUS mark, 15 U.S.C. 1052. The Board concluded that six of the 13 “DuPont factors” were relevant and that two factors “weigh heavily in favor” of finding a likelihood of confusion, one factor “weighs in favor” of finding a likelihood of confusion, two factors are neutral, and one factor weighs “slightly” against finding a likelihood of confusion. The Federal Circuit affirmed the determination as supported by substantial evidence and is not otherwise legally erroneous. While the Board is required to consider each DuPont factor for which it has evidence, it may focus its analysis on dispositive factors, such as similarity of the marks and relatedness of the goods. The Board determined that “even careful purchasers are likely to be confused by similar marks used in connection with services that are, in part, legally identical.” View "Stratus Networks, Inc. v. UBTA-UBET Communications Inc." on Justia Law
In Re: Forney Industries, Inc.
Forney sells welding and machining products in packaging that displays its proposed mark. Forney applied for a trademark based on use in commerce under the Lanham Act, 15 U.S.C. 1051(a). Forney sought to register the mark without showing acquired distinctiveness, identifying its mark as a “color mark.” Forney stated: “[t]he mark consists of a solid black stripe at the top. Below the solid black stripe is the color yellow which fades into the color red. These colors are located on the packaging and or labels.” The examining attorney refused registration, finding the mark “not inherently distinctive” and stating that “[s]uch marks are registrable only ... with sufficient proof of acquired distinctiveness.” Forney revised the description: “The mark consists of the colors red into yellow with a black banner located near the top as applied to packaging for the goods. The dotted lines merely depict placement of the mark on the packing backer card.” The examining attorney again refused registration. The Trademark Trial and Appeal Board affirmed, treating the proposed mark as a color mark consisting of multiple colors applied to product packaging.The Federal Circuit vacated. The Board erred in finding that a color mark can never be inherently distinctive in the trade dress context and that, even if a color mark could be inherently distinctive, it cannot be absent a well-defined peripheral shape or border. View "In Re: Forney Industries, Inc." on Justia Law
ICCS USA Corp. v. United States
ICCS imported 56,616 individual butane gas canisters into the U.S. that displayed a “PREMIUM” brand label and a registered certification mark owned by Underwriters Laboratories (UL). Customs determined that the canisters were “counterfeit” in that they made unauthorized use of the UL certification mark and issued a notice ordering ICCS to redeliver the imported canisters to Customs’ custody pursuant to 19 U.S.C. 1526(e). ICCS redelivered only 29,008 canisters. UL did not consent to retroactive certification. Customs assessed damages of $41,412.00.The Trade Court granted the government summary judgment. The Federal Circuit affirmed. The canisters displayed UL’s mark without UL’s approval. ICCS’s arguments as to physical similarities between the PREMIUM model and other merchandise that UL had previously certified fail because the Service Terms dictate that UL, not ICCS, determines whether any differences from the basic product are superficial. On the date of entry, Customs had no way of ascertaining whether the PREMIUM model was the same physical product as the basic product without UL having made that determination. The court rejected an argument that, in denying ICCS’s protest, Customs relied on UL’s lack of consent to the point of delegating its statutory duty to enforce the trademark laws to UL. View "ICCS USA Corp. v. United States" on Justia Law
Hylete LLC v. Hybrid Athletics, LLC
The Federal Circuit affirmed the decision of the Trademark Trial and Appeal Board sustaining Hybrid Athletics' opposition to Hylete's trademark registration application. Hylete's application sought to register a design mark for a stylized letter "H" in International Class 25 for athletic apparel. The court held that Hylete waived the arguments on which its appeal relies because it raises new issues that could have been raised and were not considered. In this case, Hylete waived its argument that Hylete's mark is sufficiently different from Hybrid's "composite common law mark" to avoid a likelihood of confusion as to the source of the athletic apparel sold bearing those marks. View "Hylete LLC v. Hybrid Athletics, LLC" on Justia Law